Nigerian Banks’, Merchant Banks Loans Drop To N52.656trn, Lowest In 14 Months

The provision of loans by Nigerian Banks and merchant banks to customers dropped to N52.656 trillion in June 2025, marking the lowest level in 14 months.

Brand News Day Nigeria reports that the Central Bank of Nigeria’s (CBN) latest quarterly statistical bulletin revealed that the last time the figure fell below this threshold was in April 2024, when it stood at N51.467 trillion.

The CBN data revealed that the June 2025 figure represents a N2.739 trillion decline from May’s N55.395 trillion, translating to a 4.95% month-on-month decrease.

On a year-on-year basis, loans dipped slightly by N9 billion, less than 1%, compared to N52.665 trillion in June 2024.

The figures reflect a cautious approach by banks in issuing loans, as the sector continues to grapple with recapitalisation compliance requirements set by the apex bank.

Data from the CBN’s latest macroeconomic outlook showed that the banking industry’s Non-Performing Loans ratio climbed to an estimated 7%, pushing the sector above the prudential ceiling of 5%.

The regulator explained that the increase followed the crystallisation of previously restructured loans that could no longer qualify for special consideration once the relief window expired.

The CBN had set March 30, 2026, as the deadline date for banks to meet the revised capital requirement.

The quarterly loan movements in 2025 are: January 2025: Loans reached N54.153 trillion, up from N53.521 trillion in January 2024. February 2025: Loans dropped to N53.059 trillion, down from N57.173 trillion in February 2024. March 2025: Loans climbed to N54.136 trillion, compared to N49.614 trillion in March 2024.

These fluctuations highlight the sector’s balancing act between expanding credit facilities and maintaining regulatory compliance.

What commercial and merchant banks’ loans represent

Commercial and merchant banks’ loans refer to credit facilities extended by two categories of banks:

• Commercial banks provide loans to individuals and businesses for general financial needs.
• Personal loans (for individuals)
• Business loans (working capital, expansion, equipment financing)
• Mortgage loans (real estate purchases)
• Consumer credit (car loans, credit cards)
• Merchant banks
• Merchant banks specialise in financing large corporations, trade, and investment-related activities.

Corporate loans for large companies

Trade finance (supporting import/export transactions)
Project finance (funding infrastructure or industrial projects)
Advisory-linked financing (loans tied to mergers, acquisitions, or restructuring)